Fracking in Louisiana: The Missing Process/Land Use Distinction in State Preemption and Opportunities for Local Participation

• Author: Alex Ritchie
• Position: Associate Professor of Law, Karelitz Chair in Oil and Gas Law, University of New Mexico School of Law, B.S.B.A. 1993, Georgetown University, J.D. 1999, University of Virginia.
• Pages: 809-862

Fracking in Louisiana: The Missing Process/Land Use Distinction in State Preemption and Opportunities for Local Participation Alex Ritchie  TABLE OF CONTENTS Introduction .................................................................................. 810 I. Background: The Fracking Dispute in St. Tammany Parish ........ 816 II. Preemption Statutes and Decisions in Most States Preserve At Least Some Land Use Authority.............................................. 819 A. The New Texas Preemption Statute ....................................... 819 B. The New Oklahoma Preemption Statute ................................ 823 C. Court Decisions in Other States Recognize the Process/Land Use Distinction ................................................ 824 III. Louisiana at the Extreme of State Control .................................... 829 A. Reserving Land as Justification for Local Control................. 829 B. Louisiana Statutes Preempt Land Use Authority ................... 834 IV. Louisiana’s Home Rule Authority Fails to Support Local Regulation of the Location of Wells ............................................. 837 A. The Road to Home Rule in Louisiana .................................... 838 B. Judicial Invigoration of Louisiana Home Rule ...................... 841 C. Judicial Re-marginalization of Louisiana Home Rule ........... 843 V. Process and Land Use Overlap in the Oil and Gas Context ......... 847 VI. Compromise and Participation as Alternatives to Local Control .......................................................................................... 853 A. Cooperative Governance or Compromise .............................. 853 Copyright 2016, by ALEX RITCHIE.  Associate Professor of Law, Karelitz Chair in Oil and Gas Law, University of New Mexico School of Law, B.S.B.A. 1993, Georgetown University, J.D. 1999, University of Virginia. The Author is grateful to Kenneth Murchison, Visiting Professor of Law, University of New Mexico School of Law, Emeritus Professor, Paul M. Hebert Law Center, Louisiana State University, for his thoughtful comments and discussion of home rule in Louisiana. The Author also thanks Ernesto A. Longa, Professor of Law Librarianship, and Alexandra R. Siek, Law Librarian, University of New Mexico School of Law, for their research assistance. 810 LOUISIANA LAW REVIEW [Vol. 76 B. Local Participation in the Drilling Decision: The Natural Resources Article to the Louisiana Constitution ....... 856 Conclusion .................................................................................... 862 INTRODUCTION Oil and gas development is testing and defining the boundaries of local government authority and autonomy as concerned municipal entities and citizens seek to limit oil and gas operations. Advances in high-volume hydraulic fracturing have increased domestic oil and gas production to historic levels. 1 At the same time, national and international concerns about irreversible man-made global warming have focused on fossil fuel combustion. 2 National groups opposed to continued reliance on oil and gas as an energy source have found willing partners in many local governments and their citizens, who are anxious about the local implications of drilling and fracking. 3 Many citizens and environmental organizations coalesce around local environmental risks such as the potential degradation of ground and surface waters and air quality, seismic activity, and social and economic costs on the local area—including increased truck traffic, road damage, noise, housing shortages, and boom and bust cycles. 4 Particularly in urban or suburban areas, voters may also perceive drilling and fracking as a threat to property values, aesthetics, and lifestyles. 1. The United States has become the largest producer of petroleum and natural gas in the world, surpassing Russia in natural gas production and Saudi Arabia in oil production. See Adam Sieminski, Presentation, Oil and Gas Outlook 14 (Oct. 16, 2015), available at http://www.eia.gov/pressroom/presentations/sieminski _10162015.pdf [perma.cc/F2V7-TUD2]. 2. See Climate Change and President Obama’s Action Plan , WHITEHOUSE .GOV, https://www.whitehouse.gov/climate-change [perma.cc/2GGM-CMWK] (last visited Dec. 27, 2015) (stating that carbon pollution is the biggest driver of climate change). 3. See, e.g. , Fracking: Community Defense , NRDC, http://www.nrdc.org/land /fracking-community-defense/?gclid=Cj0KEQiAuremBRCbtr-1qJnKi-4BEiQAh0 x08G5Ia-q4N-5_wpQYvDYFWXlAtXaquuwKRYXZB2PpnUIaAjGB8P8HAQ [perma.cc/72ZB-65D6] (last visited Nov. 17, 2015) (“The Community Fracking Defense Campaign brings the grassroots power of communities facing fracking together with the expertise of NRDC’s policy and legal team.”). 4. For a discussion of various potential environmental risks and recommended regulatory responses, see Hanna J. Wiseman, Risk and Response in Fracturing Policy , 84 U. COLO. L. REV. 729 (2013). 2016] FRACKING IN LOUISIANA 811 Now that fracking has become a topic of wider public interest, at least to the media and the relatively informed public, 5 local government efforts to control oil and gas operations appear to be a modern phenomenon. These recent efforts are, however, little more than “old wine in new bottles.” The Cities of Winkfield and Oxford, Kansas, adopted municipal oil and gas ordinances in the late 1920s that focused on the prevention of waste and the protection of correlative rights, 6 and cases that upheld the application of zoning ordinances to oil and gas operations began appearing in the 1930s. 7 Because neither fracking nor the local regulation of oil and gas operations are particularly new, 8 what has changed may be a matter of degree. As advances in technology unlock new resources, drilling and completion activities intensify in new areas that are rich in shale resources. 9 5. Those who study oil and gas issues or work in related fields may be particularly aware of the media coverage, but a 2013 study concluded that the American populace is largely unaware of and undecided about hydraulic fracturing. See Hilary Boudet et al., “Fracking” Controversy and Communication: Using National Survey Data to Understanding Public Perceptions of Hydraulic Fracturing , 65 ENERGY POL’Y 57, 63 (2014), available at http://dx.doi.org/10.1016/j.enpol.2013.10.017 [perma.cc/Z88X-VQEH]. 6. See Bruce M. Kramer, The State of State and Local Government Relations as It Impacts the Regulation of Oil and Gas Operations: Has the Shale Revolution Really Changed the Rules of the Game? , 29 J. LAND USE & ENVTL. LAW 69, 71– 72 (2013). 7. See, e.g. , Anderson-Kerr, Inc. v. Van Meter, 19 P.2d 1068, 1074 (Okla. 1933) (“The governing body of the city has a right to regulate the oil industry and the drilling of wells within its corporate limits or to prohibit them from being drilled in certain designated territory.”); Van Meter v. Westgate Oil Co., 32 P.2d 719, 721 (Okla. 1934). 8. Hydraulic fracturing, meaning the use of water to fracture rock formations to produce oil and gas, “was first tested in 1903 and first used commercially in 1948.” Thomas E. Kurth, Michael J. Mazzone, Mary S. Mendoza & Christopher S. Kulander, American Law and Jurisprudence on Fracing , at 1, 3, NW. PRITZKER SCH. L. (2012), https://www.law.northwestern.edu/research-faculty/searlecenter/workingpapers/documents/Kulander_2012_Fracing_Paper.p df [perma.cc/NN88-V7UA]. Horizontal drilling combined with slick-water hydraulic fracturing at sufficient pressure to commercially produce shale and other tight formations began around 1997 in the Barnett Shale, reinvigorating the oil and gas industry. See J. Lanier Yeates & Andrew M. Abrameit, Current Issues In Oil & Gas Shale Development , 58 ANN. INST. MIN. L. 146, 146 (2011). 9. See, e.g. , Growth in U.S. Energy Production Outstrips Consumption Growth , U.S. ENERGY INFO. ADMIN. (Dec. 5, 2012), http://www.eia.gov/pressroom/releases /press379.cfm [perma.cc/D8SH-8EFX] (describing growth in oil production from shale and other tight formations (Figure 1) and growth in shale gas production (Figure 3)). 812 LOUISIANA LAW REVIEW [Vol. 76 While local governments have historically applied locational restrictions to oil and gas operations under zoning ordinances, 10 those governments now more regularly seek to ban fracking or oil and gas production altogether. 11 Many would not normally oppose local ordinances that require the use of a closed loop system or reasonable set-backs. 12 However, a complete ban on hydraulic fracturing is extreme in the sense that it tends to eviscerate the oil and gas interest owner’s ability to produce. In recent years, domestic oil and gas production has focused on vast shale source rock and tight formations that can be accessed only using hydraulic fracturing. 13 As a result, a ban on fracking is a relatively easy way to prohibit all oil and gas production without expressly prohibiting oil and gas production. 14 Furthermore, oil and gas drilling and fracking in Louisiana and elsewhere challenge conservative Republican principles. Conservatism has long promoted state-level governance over federal government power and control. 15 Under related principles, conservatives have advocated for local 10. See Kramer, supra note 6, at 73. 11. For a collection of more than 400 local ordinances related to oil and gas operations or fracking, see Mary Grant, Local Resolutions Against Fracking , FOOD & WATER WATCH (Sept. 11, 2013), http://www.foodandwaterwatch.org/insight /local-resolutions-against-fracking/ [perma.cc/3X2S-QCZ6]. The Author has not verified that all of the collected ordinances have actually passed or are in full force and effect. 12. A closed loop system is a system that allows an operator to drill a well without using a reserve pit. Lance Astrella & Reginald Wiemers, Closed Loop Drilling Systems Can Eliminate Reserve Pit Costs , OIL & GAS J. (May 27, 1996)...